Buying a shared ownership home: New Build Homebuy

byMarie ColeonApril 14, 2009

You want to get into home ownership but London property prices put a mortgage just out of reach. Many people who find themselves in this position choose shared ownership – a more affordable solution, where you part buy and part rent the property, which can lead to full home ownership in the future.

SHARED OWNERSHIP PROPERTY ERITH – CLICK HERE FOR MORE DETAILS

Hexagon is building modern, attractive homes in convenient South East London locations to sell through New Build Homebuy, a type of shared ownership. To find out if this could be the best choice for you, please read on …

How does shared ownership work?

You buy an initial share, usually 25 – 75%, in one of Hexagon’s new homes using a mortgage from a bank or building society and pay a subsidised rent on the remaining share. The combined mortgage and rent is normally less than you would expect to pay if you bought a similar property outright.

After a year, you can increase your share of the property through ‘staircasing’. In most cases, you can eventually own your home outright.

Who is it for?

The scheme aims to help people who cannot afford to buy a home outright. Most people who take up shared ownership are working, but unable to afford to buy in the open market.

Some of the homes we build are specially for key workers – the people who keep vital public services running. They include health workers, teachers, police, prison and probation staff, some local authority staff and fire fighters.

Most are brand new homes which are often part of a larger development where some properties are for outright sale or for rent to local authority and housing association tenants. Our new homes carry a 12 month defect liability period which covers most, if not all repairs.

Am I eligible?

A minimum level of income will be required, this will vary with each home. We will be unable to help you if you can afford to buy a home outright.

We give priority to council and housing association tenants who will move out of their rented home if they get a shared ownership home, and to people on the local housing waiting list.

The scheme is available to first time buyers who cannot afford to buy a suitable home on the open market.

What will it cost me?

Bear in mind that the one-off costs involved in buying a home can add up – for example, legal fees, a valuation, mortgage fees, Land Registry and Stamp Duty, removal costs and a deposit towards the mortgage share. In order to proceed, you will require access to savings of £3,500 and maybe more.

Once you have bought, your ongoing costs include:

Your monthly mortgage repayment.

The rent which you pay to Hexagon.

If you buy a flat, a monthly service charge for the maintenance and upkeep of common parts

Usual household costs such as council tax, water rates, fuel charges and insurance.

Repairs and maintenance.

Can I buy more shares?

You can buy further shares in easy stages so that, eventually, you can own your home outright. Remember that the price of the property may have changed since you bought it, and it can go up or down. You will pay the current market value when you buy more shares. See our leaflet ‘Staircasing to a bigger share of your home’ for more information, or visit our website.

What if I want up to sell?

You can sell your share in the property at any time. You must contact Hexagon first and an independent survey must be carried out to decide what your share of the property is worth at the time you sell. For more information on this, see our leaflet ‘Selling your shared ownership home’ or our website.

What’s my next step?

Get in touch with Hexagon. We can tell you more about shared ownership and the new homes we are selling. We can also help you to work out the finances to see if this is the best option for you.